Personal Savings Bank Account as “My Second Wallet”

Building a saving habit starts from small beginnings. Parents should teach their children this habit as early as possible. They can start by getting their children their own Personal Savings bank accounts and support them in funding it. As they grow and develop a saving habit, they will soon put funds in their accounts using their own ways.

Personal Savings bank account usually requires valid IDs, applicants picture (1×1, 2×2 or passport size) and a minimum initial deposit from as low as Php 100 to as high as Php 10,000 above depending on bank’s requirements.

The interest rate you will earn with this type of account in the Philippines is only about 2 percent or less per year minus the government tax.

For example, if you have Php 100,000 in your Personal Savings bank account and you can earn about 1 percent net interest (total interest less government tax), then you’ll probably only earned about Php 60 to Php 75 per month. It’s very small earnings for your large money, like having one free ride to your work per month.

I call my Personal Savings bank account as “my Second Wallet”

Your Personal Savings Account is usually accompanied by an ATM (Automated Teller Machine) card that makes withdrawal from your account faster and easier.

Since Personal Savings bank account yields very small interest rate, I advise to treat it not as an earning investment but only as your second wallet. You can have a decent amount in your account good enough for maintaining its account limit, daily expenses and emergency, in case.

If you’re an entrepreneur that deals large amount of money with your clients, you may want to consider getting a Checking bank account.

Checking bank account is usually used by businessmen who usually transact with large amount of money. Checks make their large transactions safer and more secure because they don’t have to carry that large amount of money. Banks usually charge Php 10 to Php 20 above (depends on bank) per check issued by the account holders.

Other banks are also offering ATM cards with your checking accounts that you can use in case you need fast cash. Be aware of the penalty fees involved in checking accounts, it poses larger penalty fees than those of Personal Savings bank account. Ask your bank about these fees.

Some tips:

• Bank deposit accounts are covered by PDIC (Philippine Deposits Insurance Corporation) up to Php 500,000 in case the bank is robbed. If you have more than Php 500,000, make sure to deposit it in your trusted banks.
• Be cautious when using your ATM (Automated Teller Machine) cards especially when you’re not using your bank’s own ATM machine because banks have certain fees on this that ranges from Php 10 up to Php 100 above per transaction.
• Always keep your account active and maintain the required limit. If your account reached below its limit, you will be charged from Php 100 to Php 300 above per month for this. Also, if your account is dormant (inactive) in about a year or two, you will be charged a monthly dormant fee on this, so better keep it active.